Jan 6 2014, 3:36pm CST | by Forbes
Health care spending grew just 3.7 percent in 2012 to $2.8 trillion for a four-year growth rate the federal government deemed the “slowest rates ever recorded in the 53-year history” of the National Health Expenditure Accounts.
The Office of the Actuary at the Centers for Medicare & Medicaid Services today said 2012 health spending grew more slowly than the gross domestic product. Health spending growth has been in the range of 3.6 percent to 3.8 percent since 2009, the government said. The share of the economy dedicated to health care services actually fell a bit to 17.2 percent from 17.2 percent in 2011.
“The low rates of national health spending growth and relative stability since 2009 primarily reflect the lagged impacts of the recent severe economic recession,” Anne Martin, an economist with the Centers for Medicare & Medicaid Services, said in a statement accompanying the report. “Additionally, 2012 was impacted by the mostly one-time effects of a large number of blockbuster prescription drugs losing patent protection and a Medicare payment reduction to skilled nursing facilities.”
To be sure, spending on retail prescription drugs grew just 0.4 percent as a large number of brand name prescription drugs such as Lipitor to treat high cholesterol and the blood thinner Plavix lost sales following the loss of their patent protection. Cheaper generic drugs now abound in such treatment areas, lowering prices and decreasing spending for consumers. The slower spending growth on prescription drugs helped offset nearly 5 percent increases in spending on hospital care and physician services.
The Affordable Care Act, which this month begins to bring broader coverage of health benefits to millions of uninsured Americans, had minimal impact on 2012 health spending. But government researchers said certain “subcomponents” of health expenditures were affected such as the provision of the law that allows Americans under age 26 can remain on their parents’ health care plan and the requirement that state-regulated health plans for small businesses and individuals must spend at least 80 percent of the health insurance premium on medical costs.
Source: Forbes Business
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